Is PCP........... the next debt crisis???

johnnyboxer · Post by **johnnyboxer** » Tue Mar 07, 2017 6:17 pm

This doesn't make good reading

https://www.theguardian.com/money/2017/ ... cial-crash

Britons are on a car (and bike) buying bonanza, fuelled by cheap money and spurred on by the automobile manufacturers, by 'packaging attractive deals'

A negative change in the economy, from Brexit or an inflation or interest rate rise, could see loan impairment levels rise, causing a flood of 'repossessed cars' back onto the market, which would cause a dip in used vehicle values

It won't become a problem unless household incomes get squeezed, one way or the other

Tonibe63 · Post by **Tonibe63** » Tue Mar 07, 2017 6:36 pm

Money has been cheap for a long time JB and if interest rates rise dramatically then there will be a massive crash in the value of all sorts

V_King · Post by **V_King** » Tue Mar 07, 2017 6:40 pm

If you can't afford a new vehicle anymore, you will buy a used one. That dip in used vehicles is only going to be in a useless toys, not the commuter or family cars.

steve the grease · Post by **steve the grease** » Tue Mar 07, 2017 6:40 pm

PCP will be part of the problem, but it's only the tip of the iceberg.

http://pwc.blogs.com/press_room/2016/11 ... a-day.html

Andi_Archer · Post by **Andi_Archer** » Tue Mar 07, 2017 6:41 pm

I did read a news article the other day relating how there is a lack of newer two to five years old secondhand vehicles on the market due to the banking crisis causing a downturn on sales a few years ago.

A rise in interest will also hit hard those who have taken out a morgage on new homes built under recent housing initiative.

RandG · Post by **RandG** » Tue Mar 07, 2017 6:55 pm

Relax, it's what makes the world go round (thumbs)

IainD · Post by **IainD** » Tue Mar 07, 2017 7:07 pm

I don't get why folk keep bashing PCP, it is a great way to buy a bike.

You pay a deposit, then low monthly payments; either pay the balance, trade in against a new bike and do it again, or walk away. Very simple.

If you want to keep it and don't put some money away each month to cover the balance at the end (unless you already have it) then you are daft, but that is down to the buyer, however you don't get into financial trouble as you can still walk away debt free at the end of the period just a little wiser.

You can of course pay the balance, then sell on privately and (probably) end up with a little cash.

Further, like all credit agreements, you can end the agreement early by getting a balance to pay cost.

If you use the agreement to your advantage, you won't lose and it's probably financially safer than taking a loan for the full amount.

Whats not to like? (thumbs)

RandG · Post by **RandG** » Tue Mar 07, 2017 7:10 pm

I PCP'd my GS last year, only thing I don't like about the deal is I'm stuck with the fecker for 3 years :laugh:

johnnyboxer · Post by **johnnyboxer** » Tue Mar 07, 2017 7:14 pm

RandG wrote:Relax, it's what makes the world go round (thumbs)

Until the world's wheel falls off and the economy goes tits

Don't we ever learn??

IainD · Post by **IainD** » Tue Mar 07, 2017 7:18 pm

RandG wrote:I PCP'd my GS last year, only thing I don't like about the deal is I'm stuck with the fecker for 3 years :laugh:

But your not, request a balance to end the agreement, pay it, then use the GS as trade in for a decent bike....